The Billionaire You Should Follow Into Stocks

CNBC STAFF AND WIRE REPORTS | August 28, 2009 | 5:44 PM EDT

If you’re bored with trading in the wake of Warren Buffett, may we suggest another Wall Street whale for your consideration.We’re talking billionaire investor John Paulson. Although this hedge fund giant isn’t as widely known as Warren Buffett-- and he isn’t as rich as Warren Buffett -- heisa figure pro investors watch carefully.

(In case you’re wondering Paulson ranked #78 on the 2008 Forbes list with a net worth of $4.5 billion.)“This is someone themutual fundsare watching. This is someonw who thehedge fundsare watching," says Steve Grasso of Stuart Frankel. "This is the Warren Buffett for the next generation."Isn't he someone you should be watching too?

His big claim to fame was predicting the implosion of mortgage markets in 2007 and the collapse of banks and other financial companies in 2008. In fact, he made a lot of money when everyone else lost their shirts.

Since then, Pualson's every move has been monitored closely by big investors with the pros always especially eager to see how he trades the banking sector.

And we see no reason why the pros should know something that you don't! Following you'll find Paulson's largest bank sector holdings, according to his latest 13F filing.

John Paulson Investments in Financials: - 2% Stake in Citigroup*
- 168 million shares of Bank of America
- 2 million shares of Goldman Sachs
- 2 million Shares of UltraShort Financials ProShares
* Paulson’s 2% stake in Citi was reported by the NYPost

Should you follow Paulson into the sector or any of these stocks?

Iwouldfollow Paulson, says Jon Najarian.

I would too, adds Joe Terranova. And you should know he’s heavily into gold.
But you don’t know how guys like Paulson arehedgingthese bets, counters Guy Adami. If you’re going to follow a whale into a trade — make sure you proceed with caution.